Few of life’s pleasures are as reinvigorating as traveling abroad. New sights slow us down to savor their singularities, refreshing our perspectives and vitality. However, exploring new lands also tempts unique risks to a family’s health, safety and financial security. Left unmanaged and unmitigated, such threats can be dire.
These hazards are multi-faceted and constantly evolving. A short list includes the possibility of being injured or becoming ill in a region without sophisticated and proximate medical care, kidnapping, extortion and other criminal perils, the loss of vital documents like credit cards and passports, and the risk of trip cancellation. Other seemingly less obvious exposures include the potential for government detention and/or arrest for criminal or political reasons.
Certainly, the risks of international travel are not curbing the appetite to venture abroad—nor should they, assuming an adequate understanding and management of travel-related exposures. After several years of a tourism slowdown in the aftermath of 9/11 and the global financial crisis and subsequent recession, the world has again become smaller. According to the American Society of Travel Agents, 60% of member travel agencies’ sales so far this year derived from international travel, a 49% increase in international sales compared to 2004 figures.
Another study conducted by International SOS and Control Risks indicates considerable risks to these global voyagers. The firms’ survey of nearly 300 security, travel and corporate HR managers unearthed significant concerns among the respondents regarding such potential hazards as civil unrest (22% of respondents), opportunistic crime (18%), and terrorism (16%). Certainly, these issues are much in the news of late, given the uncertain political environment in numerous parts of the globe.
Risk 1: Political Upheaval
A recent conversation with James Wasdell, co-founder and director of Quantum Underwriting Solutions in London, underscored these risks. The agency serves the needs of high-net-worth individuals throughout the United Kingdom. James mentioned the experience of one of Quantum’s clients as a keen illustration of what can go wrong. “He had traveled to Thailand a few years ago, when suddenly out of nowhere there was an attempt to overthrow the government in a coup d’etat,” James explained. “The British government immediately advised citizens to get out of the region as soon as possible for their own safety.”
While the travelers took the recommendation to heart, the airports in Thailand soon closed and all normally scheduled flights were cancelled. James’ client returned to his hotel, as did many other stranded travelers. Needless to say, they were extremely frightened.
“Fortunately, my client had the means to charter a private jet,” James noted. “He asked others at the hotel if they would like to join him. There were 12 seats in all available on the plane, but they would all have to chip in to cover the $80,000 cost.”
The threat to the tourists’ personal safety was such that the client had no trouble gathering the funds. “Chubb wired him the money for his share of the cost within 48 hours,” James said. “Not everyone was so lucky, however. Afterwards, he did a little poll and found out that the other travelers, on average, had to wait five weeks to be reimbursed by their insurers. Even worse—several were refused reimbursement, their insurers refusing to cover the cost, arguing the chartering of a private jet was an extravagant expense.”
If the client had not the financial wherewithal to charter the jet, James suspects he and the other travelers would have been detained in the country for an indefinite period. “Thankfully, he was able to get everyone out of there before things got a lot worse,” James said. “As we have seen in Egypt and elsewhere recently, many countries that are high on people’s travel agendas also are politically unstable.”
Risk 2: Medical Maladies
Other travel risks to consider include the inferiority of medical care in some parts of the world, requiring the urgent need to be medically evacuated from one country to another to receive skilled treatment. Only a few insurers will provide their policyholders with a specialized air ambulance that comprises an on-board intensive care unit staffed with doctors, nurses and other trained personnel. Even fewer offer a 24/7 helpline to call for medical advice in the event of injury or illness.
The last-minute cancellation of a family vacation abroad costing tens of thousands of dollars and more is another eye-opening risk to consider. The same is true for the more insidious threat of kidnapping and extortion schemes perpetrated by organized criminal enterprises on the prowl for affluent travelers. Knowing how to avoid becoming a victim is a critical necessity. Again, a specialized insurer can assist these various needs.
Risk 3: Theft of Personal Belongings
While the list of travel-related risks is long, one more potential hazard warrants mention—the theft of personal belongings like expensive jewelry, furs, watches and clothing. James pointed out that room safes even in some of the most expensive five-star hotels in the world are insecure. “We always advise clients to store their valuables in the hotel’s safe,” he said.
Risk 4: Renting Abroad
For clients renting homes and apartments abroad, the agency urges that they not store any valuables at these residences, due to the threat of burglary. One never knows if outsiders know the security code for the alarm system or if door keys are in the possession of others. Indeed, it is worth the relatively minimal expense of having a locksmith change the lock settings before leasing a residence abroad.
It is because of the unique and varied risks that come with going abroad that Chubb offers coverages and services for its customers who travel frequently. Chubb’s Signature Passport suite of services, for example, can assist with medical evacuations, legal referrals, replacing lost or stolen travel documents, translation services and other issues that may arise when travelling. In addition, Chubb works with the top experts in the world to assist customers who may be involved in a kidnap and ransom or extortion plots and other security issues, such as identity theft, home security and family travel risks.
Risks are a part of life, and in no way should they impinge upon one’s desire to travel to foreign lands. The salubrious upsides are more than well worth the potential downsides. Knowing beforehand what could go wrong and then mitigating this possibility is always the best defense. As James succinctly puts it, “It’s always best to talk with risk experts in advance of venturing abroad.”